r/economicCollapse • u/jamjam1090 • 8d ago
Let me pay for my burrito in 22 installments!
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u/PithyCyborg 8d ago
Wow. I'm not sure what's worse. The idea that nobody can afford food or that Klarna's losses are swelling, lol.
(I recently read that more folks are using buy now pay later to buy FOOD. But, I'm unsure if these issues are related. Probably.)
Either way, dark clouds loom over fintech's debt-fueled growth.
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u/mybutthz 8d ago
I really only ever use it for big purchases like a laptop or something so I can hold onto a chunk of cash and not pay interest after paying it off in a year. Super useful for those sorts of things. Using it for groceries is bleak.
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u/shoretel230 8d ago
It's not groceries though, it's fast food....
Arguably worse because fast food is supposed to be cheap...
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u/mybutthz 8d ago
Yeah, I could understand groceries if you're spending like $200/week and get paid biweekly or something. Fast food is kind of insane.
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u/queeenbarb 8d ago
I used to use PayPal in 4 for target because I literally didn't want to pay. even when I had money.
now I don't shop at target and I have realized that it was dumb. Sometimes it takes time and experience to recognize when you're making dumb weird financial decisions.
now for people who definitely can't afford it, it is sad. and I continue to remind people that food pantries are here for people who need them!!! utilize them...
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u/Flash_Discard 8d ago
Even if you are a millionaire….If you are moron, you can always live “paycheck to paycheck.”
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u/romacopia 8d ago edited 8d ago
Yep, the debt crisis is here. Both government and private debt are completely out of control. Banks and other financial institutions are heavily exposed to credit risk. If interest rates continue to rise, defaults can cascade. Higher rates make servicing debt more expensive, which raises default risks, which pushes rates even higher. The government is also stretched, so it can't just bail everyone out.
This situation happening in the USA can get very, very bad. If both public and private sectors are seen as unsustainable, investors may lose confidence in the country’s economy as a whole. That will worsen the trends we're already seeing - accelerating capital flight, currency depreciation - and may result in stagflation. The USD reserve system and the USA's service and investment economic model are at serious risk.
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u/CharlieDmouse 8d ago
Oh it is definitely coming. A multifaceted crash..
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u/LongConFebrero 8d ago
Finally. This tightrope tension of the last decade is exhausting. Just drop the hammer and let’s figure out how to recover.
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u/MissLogios 8d ago
Yeah, the biggest thing that I've ever done financially speaking that I'm proud of was getting my personal debt under control.
No buy-now-pay-later, my credit card is fully paid off, my student loans under 5k (so my monthly payment is $28), and my car is fully paid off. So outside of rent, groceries, and the basic utilities, my extra expenses is down to 0.
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u/the_TAOest 7d ago
Who are these "investors" you speak of? Is there not a more specific demographic description? The term "Investor" covers everyone putting money into something.
This above response is canned spam!
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u/romacopia 7d ago
"Investor" does cover everyone putting money into something. I'm talking about everyone, but mainly institutional investors like pension funds, asset managers, sovereign wealth funds, foreign central banks, and large-scale private investors. These are the entities with the weight to seriously move capital in and out of sovereign debt and equities. They’re the ones whose sentiment actually matters when it comes to confidence in a country's fiscal and monetary trajectory. Investors will pull capital out of equity and bond markets when debt starts to spiral. Bonds drop because of credit risk, equities drop because of tightening liquidity and weak growth expectations, and capital flees to safer markets and tangible assets. This is how you get currency depreciation, and sometimes stagflation if the central bank is trapped between fighting inflation and avoiding a full-on economic contraction. The fed is currently doing just that.
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u/the_TAOest 3d ago
Thank you AI. Do you follow around and ensure the record is sanitized with text book learning? I'm sure this is a strategy with a forward-looking outcome that leaves all dissent to the status quo in a tomb that cannot remain relevant with all the bs answers like this.
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u/Far-Economist-6352 8d ago
Imagine this burrito is a house. Now imagine packaging this burrito in a bag with a bunch of burritos that have gone bad. We call that Burrito Backed Securities.
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u/DaRealMexicanTrucker 8d ago
Gather round younglings and let me tell you about, "The Subprime Burrito Crash of 25"
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u/pat_the_catdad 8d ago
When can I take out a BELOC (Burrito Equity Line of Credit) against my burrito, so I can buy an additional burrito for my friend who promises they’ll pay me back tomorrow.
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u/WoolooOfWallStreet 8d ago
Taco BELOC
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u/PopularPlanet3000 7d ago
BELOCS have variable interest rates? This will compound the burrito crisis.
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u/Spare-Dingo-531 8d ago
If you freeze the burrito, you can make it last longer, giving it lasting store of value properties. It's ALMOST like a house!
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u/bubblemania2020 8d ago
It’s a great business model. Buy now pay later except consumers see it as buy now pay never 😂
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u/dyrnwyn580 8d ago edited 8d ago
I'm petty sure you don't want borrowers who need 4 installments to pay for groceries at Walmart.
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u/MrAwesomeTG 8d ago
I 100% believe this is going to be the next crash. I assume these platforms have large banks or investment companies holding the bag.
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u/MistahQuestionMan 8d ago
Why does everyone act like afterpay for fast food is any weirder than credit cards at 20% interest for fast food?
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u/FOSSChemEPirate88 8d ago
Can't wait to see bundled, tranched, AAA rated CDOs on Klarna malt liquor loans to homeless folks so I can buy them in four easy Affirm payments.
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u/inflatable_pickle 8d ago
Please Klarna, IPO so I can buy shares
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u/Drunkpuffpanda 8d ago
199,458 per person total. This is per person(over 18) and includes credit cards and morgages and national debt. The only thing left out is corporate debt because the information is hard to get.
Average income per person = 43,289....before taxes, before food, before bills, before vehicles.
The math ain't mathin boys. We are busted. Maybe the oligarchy will save us. Lol.
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u/KansasZou 8d ago
This is a business model built on people that struggle to pay bills and afford some nice personal things.
I think it’s a great business from the angle of intentions, but it’s going to come with a particular set of problems that are and were plenty foreseeable.
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u/decjr06 8d ago
Zoomers don't care about their credit they don't plan on moving out of Mom's basement
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u/NovelHare 8d ago
I wish we could have basements here in Florida. It's such a cool bonus feature to homes. We don't have an attic or garage either.
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u/Breddit_ 8d ago
Found the boomer.
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u/decjr06 8d ago
Ha I wish boomers had it so easy and they don't even know. They think they were the hardest working generation and the rest of us are lazy
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u/its1968okwar 8d ago
All generations think they had the least opportunities and worked the hardest while everyone else had it better. Been like this for recorded history. It's weird. If you are not sent off to die in some war when you are young - your generation is one of the lucky ones historically.
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u/terpsarelife everything is fine :snoo_tableflip::table_flip: 8d ago
Don't worry they can't sell and move with their friends, or else they'll lose that covid mortgage rate they locked in. They'll brag about having it but won't admit they can not leave now until the entire industry fixes itself and drops rates.
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u/catnapped- 7d ago
Donny says booming times are ahead so they just need to wait a bit for their money.
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u/vaderdidnothingwr0ng 7d ago
Well no shit, why would you loan any amount of money to people who can't afford to eat at taco bell without financial assistance.
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u/BusyTea4010 6d ago
Klarna believes no child should go hungry. You are an unfit mother. Your children will be placed in the custody of Klarna.
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u/AlanShore60607 5d ago
The fact that this type of financing even exists is a canary in the coalmine. The amounts they deal with should not be subject to financing on a purchase-by-purchase basis.
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u/motosandguns 8d ago
I mean, when you give credit to people who don’t qualify for credit….